Nokia-Symbian Deal Will Push Wireless Giants to Seek New Mobile Platforms

Experts say that Nokia Corp.'s (NOK) $410 million purchase of Symbian Ltd. will spur other wireless device makers to explore using another operating system to avoid having to buy a mobile platform from their top cell-phone rival. "I would expect most of them to migrate to another platform," says Rob Enderle, principal analyst with technology consulting firm Enderle Group. "This should benefit Microsoft a great deal."

The deal also could benefit Microsoft Corp. (MSFT), the No. 3 player in wireless operating system technology with its Windows Mobile platform, which is working aggressively to catch up. Just how dramatically Nokia's purchase could upset the mobile operating system market is reflected in market share data. According to research firm Gartner Inc., Symbian had 57.1% of the market in the first quarter of the mobile platform sector, followed by Research in Motion Ltd. (RIMM), with 13.4%, and Microsoft, with 12%.

RIM, and to a lesser extent Microsoft, have recently made significant strides against Symbian, whose market share was 63.5% a year ago. Now a confluence of industry trends appears to be breaking the market wide open. Apple's (AAPL) successful and consumer-friendly iPhone has turned the market on its head. Google Inc. (GOOG) is pushing into the market with its own Android mobile operating platform. And Microsoft, in the wake of its abandoned attempt to buy Yahoo! Inc. (YHOO), is looking for other ways to boost its consumer Internet presence.

Indeed, the software giant is increasingly expected to focus on the mobile Internet, where online traffic is expanding rapidly. Some analysts have even suggested Microsoft ultimately passed on Yahoo! so it could shift its attention to creating better tools and services for the mobile Web. Microsoft has steadily been buying smaller companies to advance its mobile presence. Earlier this year, it acquired mobile software maker Danger Inc.; last year it bought TellMe, a maker of voice-recognition technology that is expected to have a large presence on the mobile Web.

"It is a critical juncture for the cell phone business," says Mark McKechnie, an analyst with American Technology Research. "All phones are becoming smarter, and a lot of companies want to dominate that market. Microsoft will likely keep spending and spending until it gets it right."

Comments

[lauttage]

Rob Enderle, principal analyst, makes bold statements without facts. Hopefully his payable advice is more accurate.